Actually, Argentina's Leaders Might Be Totally Geniushttp://www.businessinsider.com/stay-is-best-scenario-in-argentina-case-2014-7/comments
en-usWed, 31 Dec 1969 19:00:00 -0500Fri, 09 Dec 2016 20:32:49 -0500Linette Lopezhttp://www.businessinsider.com/c/53dad77c6bb3f7ff2b7542f6figueroaThu, 31 Jul 2014 19:55:40 -0400http://www.businessinsider.com/c/53dad77c6bb3f7ff2b7542f6
Argentines suffering hunger? Care to explain how this non-default will affect the Argentinean economy? You don't seem well informed....http://www.businessinsider.com/c/53dad6d96bb3f7f8267542f5figueroaThu, 31 Jul 2014 19:52:57 -0400http://www.businessinsider.com/c/53dad6d96bb3f7f8267542f5
I fail to see how this pseudo-default affects the Argentinean economy in any way, or it's relation to the rest of the World. Argentina has no current access to financial markets, and most of the World's countries support the Argentinean position.http://www.businessinsider.com/c/53dad6d66da8119b2c3cbf5ffigueroaThu, 31 Jul 2014 19:52:54 -0400http://www.businessinsider.com/c/53dad6d66da8119b2c3cbf5f
I fail to see how this pseudo-default affects the Argentinean economy in any way, or it's relation to the rest of the World. Argentina has no current access to financial markets, and most of the World's countries support the Argentinean position.http://www.businessinsider.com/c/53da99b66da8117b0ce15124LO_PEZThu, 31 Jul 2014 15:32:06 -0400http://www.businessinsider.com/c/53da99b66da8117b0ce15124
crookshttp://www.businessinsider.com/c/53d8f73a6bb3f7dc410dc1caBill MarquisWed, 30 Jul 2014 09:46:34 -0400http://www.businessinsider.com/c/53d8f73a6bb3f7dc410dc1ca
OBL had nothing to do with 9.11. he didn't really do much at all.http://www.businessinsider.com/c/53d8f661eab8ea552251504bBill MarquisWed, 30 Jul 2014 09:42:57 -0400http://www.businessinsider.com/c/53d8f661eab8ea552251504b
screw NML and paul singer, they are parasites.http://www.businessinsider.com/c/53d8222869bedda764507914NovaTue, 29 Jul 2014 18:37:28 -0400http://www.businessinsider.com/c/53d8222869bedda764507914
Ah, thanks for clarifying that. I didn't understand exactly where the 15bn came from, I thought it was the payment to the current exchanged bond but with RUFO triggered. But it does better sense if it refers to only the 8% of not exchanged bonds. But yeah, people who do not understand the true numbers or where they come from or how, do not understand why Argentina would prefer a default rather than a 120bn-500bn default per RUFO.http://www.businessinsider.com/c/53d80a016bb3f7402ed93491megantropicTue, 29 Jul 2014 16:54:25 -0400http://www.businessinsider.com/c/53d80a016bb3f7402ed93491
Is a lie that the RUFO would trigger 15 billion in payment. Those 15 billion are unrelated to the RUFO.
15 billion is the amount owed to the 8% of bondholders who refused the exchange swap, and they are not tied to the RUFO clause.
The RUFO clause only affects the 92% of RESTRUCTURED bondholders, and would trigger a payment between 120 billion and 500 billion.
Get your facts right before pretending to be an imitation of journalist.http://www.businessinsider.com/c/53d74fc8eab8ea9d387af23cBrutal HonestyTue, 29 Jul 2014 03:39:52 -0400http://www.businessinsider.com/c/53d74fc8eab8ea9d387af23c
If all the gringos left South America, it would collapse back into the stone age and deep in your heart you know it's true.http://www.businessinsider.com/c/53d74d57ecad0482522d921cBrutal HonestyTue, 29 Jul 2014 03:29:27 -0400http://www.businessinsider.com/c/53d74d57ecad0482522d921c
The US government (usually the State Department) leans on the bank to make loans to deadbeat countries in order to receive political favors.
The bank gets a promise from the US government that if it's not repaid, they will be eventually be reimbursed by the government which is to say US taxpayers.http://www.businessinsider.com/c/53d7194f6bb3f7ae7e2d921eNovaMon, 28 Jul 2014 23:47:27 -0400http://www.businessinsider.com/c/53d7194f6bb3f7ae7e2d921e
sobering country, auto-correct you make laugh so much.http://www.businessinsider.com/c/53d7186b6da811b2693465cfNovaMon, 28 Jul 2014 23:43:39 -0400http://www.businessinsider.com/c/53d7186b6da811b2693465cf
So, I joined because I have been reading your articles on the matter from day June 30th. First, I must say you don't seem a very serious journalist, one day in favor the next totally against.
Regardless of my opinion on the writer, from the beginning I thought the country was going for default and I am now confirmed of it. People called it the game chicken, when the one with more losing status is the holdout. The country is already in recession and it has never rejoined the international financial system since 2002. It hasnt been able to borrow money since the default of 2002 and it cannot do it today either no matter how many want to lend it its money, like it was done to solve the "temporary" debt crisis on the US.
So, as the court has established, pay to the 1% or don't pay at all. What options does the country have?
1- Stay until 2015 was, is and will be the best scenario for both parties.
2- Pay the 1% and trigger RUFO, some companies have already informed they will rise it should Argentina pay the holdout. So paying this 1% causes the country to default on approximately 200bn.
3- Do not pay the 1%, and default on around 90bn including the exchanged bonds. Economists correct me if I am wrong, but should the country default, the exchanged bonds will stay as such as long RUFO is no triggered, correct? If that is the case, the only possible solutions for the country are options 1 and 3. 2 is not acceptable by any means on economic levels unless you are brain dead.
So, let go for option 1. How can this be accepted by holdouts and the judge? They don't want it because they do not "believe" in the country, and want some offer of good faith, when none has been presented to the country. So, if I were and hedge found, I would ask the judge to keep the stay for 6 more months, see if the country was indeed just waiting for the clause to finish, if they still insist they will not pay, just have the stay removed again. A new debt will have to be paid in 2015, and they will not have the RUFO excuse to use against the payment. They could use the same tactic, force the country to default should they not pay.
But then, what happens in case of option 3? The country defaults, the holdout are forced to not get paid because Argentina is a sobering country, and will have to wait again who know how many years or try to confiscate stuff from the country, which again, it is protected by international law, they have no way of winning from a country's default. And the country? Well, economic stagnation would increase, peso will drop more than it already has, but this will not reach the levels of economic catastrophe of 2002's default were the monetary system just completely crashed and people resorted to old age trades. At that time, the country could not pay, now it can but isnt allowed to. You can see it by how low are the exchanged bonds dropping, only a few cents 2 days before a default, never seen that before. So the country just have to wait 6 months until the RUFO ends, and then everything can be payed at the same time, the exchanged bonds and the holdouts. I have already lived the 2002 default, economy will be rought for next months, but no way will be worse that the past default. If that is what the country has to deal will to avoid a 200bn default like the 2002, I'd take the 6 rough months every day.
For all purposes, this is just the opinion of a simple argentinian. The government will demonize the holdouts which I believe is ok, and will do also to the judge and US judicial system, which I don't think it is right, but they are using this a political propaganda. Regardless of the useless propaganda, I am forced to agree with the government in this case should we choose to default if not granted an stay, the judge has simply left us with no choices.http://www.businessinsider.com/c/53d70a916da811e82d3465cfBowl LudoMon, 28 Jul 2014 22:44:33 -0400http://www.businessinsider.com/c/53d70a916da811e82d3465cf
You can pretty much discount the possibility of any scenario in which Argentina would be required to negotiate in good faith.http://www.businessinsider.com/c/53d6ef7f69beddd3498c9262juanchotalargaMon, 28 Jul 2014 20:49:03 -0400http://www.businessinsider.com/c/53d6ef7f69beddd3498c9262
Everybody saying that the RUFO clause will not likely trigger is because they have some sort of interest on it to actually happen. Would you risk 120 bn for something not 'likely' to happen? Open your eyes, remember this is all about money here!http://www.businessinsider.com/c/53d6c85469bedd10208c9263donaldmcintyreMon, 28 Jul 2014 18:01:56 -0400http://www.businessinsider.com/c/53d6c85469bedd10208c9263
Ha,ha! This is why I included Osama and Putin, but I guess it counts as Godwin's law anyway!http://www.businessinsider.com/c/53d6c41becad0471292d921eWinston SmithMon, 28 Jul 2014 17:43:55 -0400http://www.businessinsider.com/c/53d6c41becad0471292d921e
Oops, you just violated Godwin's law. No soup for you.http://www.businessinsider.com/c/53d6bf886bb3f7411d2d922edonaldmcintyreMon, 28 Jul 2014 17:24:24 -0400http://www.businessinsider.com/c/53d6bf886bb3f7411d2d922e
You are right, what I meant above is that they will lend at a premium compared with other risks. This premium represents billions in present value, much more than saving $15 billion in the short term (and the whole reputation of an entire country which brings huge costs to the private sector).http://www.businessinsider.com/c/53d6b4a06da811a3113465d1KKKKKMon, 28 Jul 2014 16:37:52 -0400http://www.businessinsider.com/c/53d6b4a06da811a3113465d1
That was before the big banks had to be bailed out by the US taxpayer.
Obviously your big global banker had no idea.http://www.businessinsider.com/c/53d6ad79ecad04204d93ea6cchris HauserMon, 28 Jul 2014 16:07:21 -0400http://www.businessinsider.com/c/53d6ad79ecad04204d93ea6c
good, they can try and collect.http://www.businessinsider.com/c/53d6acd9eab8ead44266954fchris HauserMon, 28 Jul 2014 16:04:41 -0400http://www.businessinsider.com/c/53d6acd9eab8ead44266954f
you are wrong, they'll fall all over themselves to loan to the reformed mature new argentina.http://www.businessinsider.com/c/53d6ac8c6bb3f71760523a5achris hauserMon, 28 Jul 2014 16:03:24 -0400http://www.businessinsider.com/c/53d6ac8c6bb3f71760523a5a
whatever, she'll move to ireland.http://www.businessinsider.com/c/53d6a6706bb3f72845523a5fdonaldmcintyreMon, 28 Jul 2014 15:37:20 -0400http://www.businessinsider.com/c/53d6a6706bb3f72845523a5f
Calling Argentine officials "genius" for their handling of their national credit and debt is like calling Osama Bin Laden "genius" for how masterful the 9/11 attacks were, or Hitler "genius" for building the incredible logistics for killing 6 million people, or currently Putin "genius" for how he snatched Crimea and will snatch eastern Ukraine at no apparent cost from the international community. This is just cheap and a low blow to the millions of Argentine suffering hunger for this government's actions.http://www.businessinsider.com/c/53d6a5b36da811d6403ad8c1Duh2.youMon, 28 Jul 2014 15:34:11 -0400http://www.businessinsider.com/c/53d6a5b36da811d6403ad8c1
What this really says that when you buy government debt (it does not matter if it is issued by a country (Argentina), state, territory (Puerto Rico), or municipality (Detroit)) don't expect that you can hold them to the terms of the deal, and you better price that risk in.http://www.businessinsider.com/c/53d6a4fa6da8117c413ad8bddonaldmcintyreMon, 28 Jul 2014 15:31:06 -0400http://www.businessinsider.com/c/53d6a4fa6da8117c413ad8bd
Please don't call someone who doesn't pay their debts just for the sake of it, and disrespects their creditors, and calls a lost legal case in the US justice system "a legal extorsion", and tells the world that the judges in the 3 levels in the case (New York, US court of appeals, and US Supreme Court) are being bribed by the hedge funds, that they are "actually genius".http://www.businessinsider.com/c/53d6a3716da81142393ad8b9donaldmcintyreMon, 28 Jul 2014 15:24:33 -0400http://www.businessinsider.com/c/53d6a3716da81142393ad8b9
Since 2001 Argentina has acted very aggressively (in a bad way) towards all creditors imposing without negotiation a 65% haircut in both the 2005 and 2010 exchanges. This was due to its intransigent position that made creditors just accept whatever was on the table and because it exercised it sovereign status.
The holdouts are only 7% of the whole original debt, but because of its strategy Argentina has ruined its credit in 2 ways:
1. It hasn't had access to credit for 13 years now and this has been at a high cost in growth that never happened because there was no financing.
2. The rate Argentina would have to pay for new debt will be at a premium to normal risks for a long time, this premium represents billion in financial cost that otherwise wouldn't exist and certainly represent much more than the $15 billion it is trying to avoid now.http://www.businessinsider.com/c/53d69c8069bedd6c6a93ea68Winston SmithMon, 28 Jul 2014 14:54:56 -0400http://www.businessinsider.com/c/53d69c8069bedd6c6a93ea68
Well, mostly it tells you that Latin America is really big. What that has to do with Argentine debt is beyond me, though.http://www.businessinsider.com/c/53d69557eab8ea3264669554LilguyMon, 28 Jul 2014 14:24:23 -0400http://www.businessinsider.com/c/53d69557eab8ea3264669554
Actually, BOA, once a small Italian family bank headquartered in the gold rush mining town of San Francisco, CA.http://www.businessinsider.com/c/53d68cc76da811c04b3ad8b9"El Che"Mon, 28 Jul 2014 13:47:51 -0400http://www.businessinsider.com/c/53d68cc76da811c04b3ad8b9
More than 600 million people in Latin America, almost double US and growing at more than double the rate. What does that tell you, gringo?http://www.businessinsider.com/c/53d68b736da81177413ad8bcEast LAMon, 28 Jul 2014 13:42:11 -0400http://www.businessinsider.com/c/53d68b736da81177413ad8bc
By the way, where is Jerry Brown today? He has spent more time in Mexico than Obama.http://www.businessinsider.com/c/53d6897d6da811913c3ad8bbWinston SmithMon, 28 Jul 2014 13:33:49 -0400http://www.businessinsider.com/c/53d6897d6da811913c3ad8bb
Mexico is a much, much wealthier country today than it was in 1994. That is part of the reason why net illegal immigration from Mexico to the USA has stopped, and probably reversed, in recent years.http://www.businessinsider.com/c/53d6868c6bb3f7ca3e523a5ekellydorsey8Mon, 28 Jul 2014 13:21:16 -0400http://www.businessinsider.com/c/53d6868c6bb3f7ca3e523a5e
Wall Street's NML Capital may be 'too big to fail' or produce cars - meaning it's US taxpayer debt.http://www.businessinsider.com/c/53d67d3169bedd076493ea68SandanistaMon, 28 Jul 2014 12:41:21 -0400http://www.businessinsider.com/c/53d67d3169bedd076493ea68
Actually, Mexico has since its revolution been a big part of Russia influence. The Russia's largest embassy is in Mexico City. The Russians have used Mexico for a variety of things. Do some reading on Oswald and the Russian Embassy in Mexico City. Of course, the Chinese are now much more influential and Xi was in Mexico on the same trip to BA and later, Brazil. Even Abe was in Mexico last week for a few days. They all see that the US will be "hispanized" eventually. Even if poor, little, Guatemala were a State, if would the fourth largest, larger than Illinois or Ohio. And, that is not counting the over one million Guatemalans currently in the US. Want a real eye opener, all those banana republics in Central America have a population more than 3 million larger than CALIFORNIA.http://www.businessinsider.com/c/53d67cf7ecad04700a93ea6chstad6Mon, 28 Jul 2014 12:40:23 -0400http://www.businessinsider.com/c/53d67cf7ecad04700a93ea6c
How did they prosper? It destroyed the middle class and increased poverty! You need to actually understand what a devaluation on a country's currency does to the economy. Look at the devaluation of the Mexican Peso in 1994 - it destroyed Mexico's middle class and they still through today have yet to recover.http://www.businessinsider.com/c/53d679de69bedda65493ea68webcookiesMon, 28 Jul 2014 12:27:10 -0400http://www.businessinsider.com/c/53d679de69bedda65493ea68
Thanks, calling evil comunist dictators geniuses, oh well, anything for a click, right?http://www.businessinsider.com/c/53d679456bb3f7ff0b523a5cWinston SmithMon, 28 Jul 2014 12:24:37 -0400http://www.businessinsider.com/c/53d679456bb3f7ff0b523a5c
For resource states, it is pretty much the norm to have leaders who are competent negotiators but terrible administrators, and irresponsible neighbors. You could compare her to Vladimir Putin, or Hugo Chavez.http://www.businessinsider.com/c/53d67817eab8eabc6b669556Winston SmithMon, 28 Jul 2014 12:19:35 -0400http://www.businessinsider.com/c/53d67817eab8eabc6b669556
The $1.3 billion is what they specifically owe NML, which is at most 8% of Argentina's debt. Under the terms of the RUFO if they pay NML $1.3 billion they have to give their other creditors comparable terms, which means they would have to pay out at least another $15.3 billion. Maybe they could handle the $16.6 billion maybe they couldn't, but it would certainly be a major hit on their economy.http://www.businessinsider.com/c/53d674ec69bedd783e93ea69Peter VerkooijenMon, 28 Jul 2014 12:06:04 -0400http://www.businessinsider.com/c/53d674ec69bedd783e93ea69
"... they would never default ..."
Too big to fail; how we entered the era of unlimited state/elite power - and real world economic stagnation/decline.http://www.businessinsider.com/c/53d673bc6da8111d503ad8bbPeter VerkooijenMon, 28 Jul 2014 12:01:00 -0400http://www.businessinsider.com/c/53d673bc6da8111d503ad8bb
Argentina is a failed socialist/fascist state. If you prefer your economy to be based on pure State fiat power, instead of productivity, real value creation and fairness based in rule of law, sure, the Argentinian leaders are some kind of twisted genius.http://www.businessinsider.com/c/53d672bc6bb3f70476523a61roger Mon, 28 Jul 2014 11:56:44 -0400http://www.businessinsider.com/c/53d672bc6bb3f70476523a61
was there a misprint or ? $1.5 billiion ... that's nothing ... US Dept of Treasury prints that much money in an hour ... why can't Argentina give 'em the same "fool's gold"http://www.businessinsider.com/c/53d672906da81164453ad8bfCascadesWAMon, 28 Jul 2014 11:56:00 -0400http://www.businessinsider.com/c/53d672906da81164453ad8bf
Mao, China owns South America and Africa as much as Russia owns Mexico.http://www.businessinsider.com/c/53d6709569bedde02c93ea6cWinston SmithMon, 28 Jul 2014 11:47:33 -0400http://www.businessinsider.com/c/53d6709569bedde02c93ea6c
Lots of Latin American countries, including Argentina, implicitly defaulted on huge debts during the 1980s, and many of them prospered afterward. The main difference this time around was that the Argentinians were more obvious about it.http://www.businessinsider.com/c/53d66fafeab8eaee5466954fLilguyMon, 28 Jul 2014 11:43:43 -0400http://www.businessinsider.com/c/53d66fafeab8eaee5466954f
Default now. They've done it before, they can do it again--and the stupid bankers will lend them money again.
I asked a senior global banker in the late 1970s why his bank (& many others) thought foreign governments would not default on the massive "syndicated" loans they were passing out at the time like recent history's CMBS, etc. He said they would never default--they were sovereign governments that could not take that economic risk.
Many did default--including Argentina--and the game continues.http://www.businessinsider.com/c/53d66f1b6da81196393ad8b9tmgotechMon, 28 Jul 2014 11:41:15 -0400http://www.businessinsider.com/c/53d66f1b6da81196393ad8b9
So true. Maybe, as "Finance Editor", she could write about dress shopping and the best ways to pay. You know, a "debit card vs. credit card vs. PayPal" kind of thing.http://www.businessinsider.com/c/53d66e7c69bedd482493ea6aWinston SmithMon, 28 Jul 2014 11:38:36 -0400http://www.businessinsider.com/c/53d66e7c69bedd482493ea6a
I think the obvious lesson from this episode is that nothing in Argentina is actually "owned", especially by a foreigner. It is only "rented" from the current government, under terms that can be, er, "renegotiated" by future ones.http://www.businessinsider.com/c/53d66e0eeab8ea555066954fLOLMon, 28 Jul 2014 11:36:46 -0400http://www.businessinsider.com/c/53d66e0eeab8ea555066954f
Not paying your debt is genius? HAHAHAhttp://www.businessinsider.com/c/53d66debecad04fc4193ea6cWinston SmithMon, 28 Jul 2014 11:36:11 -0400http://www.businessinsider.com/c/53d66debecad04fc4193ea6c
What's incorrect about what she wrote here? The headline is silly, but the content of the article seems to make sense.http://www.businessinsider.com/c/53d66dad6bb3f79c61523a5eMaoMon, 28 Jul 2014 11:35:09 -0400http://www.businessinsider.com/c/53d66dad6bb3f79c61523a5e
First off, Kristina cannot break her promise not to pay to her followers. That would ruin not just her but Peronists as well. Second, she has the backing of the Chinese, Xi was just in BA, for all the foreign investment they need. The US is going to be the big loser in this deal. The Chinese now own South America and Africa.http://www.businessinsider.com/c/53d66d4269bedd6d1f93ea6eOMGMon, 28 Jul 2014 11:33:22 -0400http://www.businessinsider.com/c/53d66d4269bedd6d1f93ea6e
Ha, this is funny because it's so true.http://www.businessinsider.com/c/53d66d2fecad04cf4b93ea6eOMGMon, 28 Jul 2014 11:33:03 -0400http://www.businessinsider.com/c/53d66d2fecad04cf4b93ea6e
This all assumes that Singer hasn't bought a ton of protection on argy. In that case he wins.http://www.businessinsider.com/c/53d66c7469beddca1e93ea72depressionMon, 28 Jul 2014 11:29:56 -0400http://www.businessinsider.com/c/53d66c7469beddca1e93ea72
I think they just won't pay .....
It's not like their going to get invaded and have their country repossessed .....http://www.businessinsider.com/c/53d66b786bb3f7995b523a5ckennymacMon, 28 Jul 2014 11:25:44 -0400http://www.businessinsider.com/c/53d66b786bb3f7995b523a5c
In the same way Detroit's leader's were geniuses eh?http://www.businessinsider.com/c/53d66b66eab8ea613d66955cjust stopMon, 28 Jul 2014 11:25:26 -0400http://www.businessinsider.com/c/53d66b66eab8ea613d66955c
Linette, please stop writing about finance. It makes me cringe every.single.time.